The Hindu Business Line : <I>Blue ocean strategy</I>

MANAGEMENT field brims with new ideas. It has to, otherwise it will not be accepted as a credible pursuit. Also, the constant intellectual churning that goes on questions old assumptions and concepts, and throws up new avenues to explore, new strategies to exploit and new approaches to adopt.

For instance, a proposition that was hitherto assumed to be immutable was about the central role of competition in keeping companies alive to the importance of quality and customer service.

Competition to sustain and increase returns and ensure a higher and higher growth trajectory necessarily meant countering threats from rivals within a given industry or enterprise.

A decade ago, taking account of the drain of energy and resources this involved, a new approach, named coopetition, developed trying to blend the spirit of competition with forging alliances for cooperation by farming out product lines and market shares to viable partners, and thereby cutting costs and getting the maximum advantage out of core competencies. But whether it was competition or coopetition, it worked within a known and familiar space, because of the fear of the unknown that hampers bold initiatives.

In figurative terms, the players of the past were content to sail in red ocean whose waters are bloody with cut-throat competition and replete with remnants of the bitter struggles that needed to be waged to survive, leave alone succeed.

Taking off from there, in a new book, Blue Ocean Strategy, published by the Harvard Business School, authors W. Chan Kim and Renée Mauborgne have (again figuratively) envisaged vast blue oceans which hold potential and prospects which have so far not been tapped or even thought of.

The pith and substance of their thesis is that any pioneering and imaginative entrepreneur who steers outside the red ocean to the still pristine blue ocean, to seek uncontested market space are bound to unlock doors to hoards of treasures that had remained hidden, besides enriching humankind itself with novel kinds of products and services.

The book cites several examples and tools and techniques such as strategic moves and value innovation that make this a win-win strategy. Altogether it opens a beckoning vista for the budding tycoons of the brave new world of the 21st century.

B. S. Raghavan

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